Georgia is among the hardest hit states so far in the federal government’s campaign to cut its office space.

The General Services Administration, which oversees the government’s leased and owned properties, has canceled 11 leases so far this year in Georgia totaling nearly 260,000 square feet, according to a new data tracker by real estate services firm Avison Young. That’s the sixth most nationally for square footage among the 50 states and Washington, D.C. The nation’s capital ranked first with nearly 1.5 million square feet.

The cancellations, part of the Trump administration’s cost-cutting efforts, are a blow to an Atlanta office market still contending with oceans of unused space. The total vacated space would be the equivalent of about one-fifth of Atlanta’s tallest tower, Bank of America Plaza.

“GSA leases are typically very sticky, and I think that has really caused a bit of a rumble effect,” said Chris Godfrey, principal of office leasing in Atlanta for Avison Young.

He said it raises a pertinent question for other office owners with government leases: “What happens with these leases in our buildings?”

Nearly half of the space being vacated comes from one canceled lease at a Chamblee office building formerly occupied by the Centers for Disease Control and Prevention. The other spaces, which span from Savannah to Norcross, housed divisions of nine other departments and agencies.

A GSA spokesperson told The Atlanta Journal-Constitution the cut leases are part of President Donald Trump’s directive “to right size the federal real estate portfolio” and ”cut unnecessary costs by ensuring taxpayers no longer pay for empty and underutilized federal office space" and maintenance.

The agency has made headlines this year as those slashing efforts kicked into gear — sometimes with chaotic results.

The agency in March placed 443 office complexes, courthouses and other operations centers on a disposal list of “noncore assets” to try to sell, only to remove the list within hours. The initial disposal list had 17 Georgia properties.

The Peachtree Summit building is shown at 401 West Peachtree St NW, Wednesday, March, 26, 2025, in Atlanta. The federal government has listed the Peachtree Summit building as “accelerated disposal.”(Jason Getz / AJC)

Credit: Jason Getz / Jason.Getz@ajc.com

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Credit: Jason Getz / Jason.Getz@ajc.com

As of Friday, 45 properties nationwide are listed for disposal, including the 29-story Peachtree Summit tower in Atlanta.

Grant Hayes, an analyst for Avison Young, said the rapid changes to GSA’s real estate portfolio, including its canceled leases, mostly tie to work by the Department of Government Efficiency, formerly helmed by Tesla CEO Elon Musk.

An acceleration

Efforts to shrink the federal real estate footprint predate Trump’s administration, including his first term.

President Barack Obama in 2012 established the “Freeze the Footprint” initiative aiming to stop the growth of federally owned office and warehouse properties. Since then, the amount of GSA-owned space has shrunk about one percentage point each year.

Hayes said Trump and DOGE just supercharged that effort and expanded to include leased space. He compared it to similar directives in the private sector following the COVID-19 pandemic when companies trimmed space as more workers went remote or took on hybrid schedules.

While prior efforts have been methodical and steady, the Trump administration has publicly adopted the Silicon Valley ethos of “move fast and break things” to aim for quick change — even if it means making errors.

Hayes said data shows GSA has made “some mistakes throughout the process where they canceled a lease they couldn’t cancel,” adding that the effort has slowed down this summer.

“It’s definitely slowed a lot in the last few weeks, probably because now they have to start getting way more strategic with it,” he added.

‘Soft’ targets

GSA leases are structured with “hard” and “soft” terms, which designate when changes or cancellations can be made. For example, the first decade of a 15-year lease may be “hard,” meaning the GSA can’t alter it, while the end period may be “soft” and cancelable.

The GSA typically gives one year’s notice to canceled leases, Hayes said, but it’s recently been closer to six months. As a result, a lot of canceled leases went into effect by mid-2025, roughly a half-year into Trump’s second term.

By the end of 2026, more than 2 million square feet of GSA leases will enter the “soft” term and could be canceled, according to Avison Young. Godfrey said it’s unlikely all — or even a significant portion — of those leases will hit the chopping block because federal workers have to abide by federal in-office policies.

“If you strike 120,000 (square) feet of your books, where do those people work?” he said. “So I could see a comeback from it eventually.”

A couple of people are seen headed to the Sam Nunn Atlanta Federal Center on Monday, February 24, 2025. This day marked the first full return-to-office day for numerous federal workers in downtown Atlanta.
(Miguel Martinez/ AJC)

Credit: Miguel Martinez-Jimenez

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Credit: Miguel Martinez-Jimenez

The GSA did not disclose its future plans for those soft-term leases or how much more it aims to shrink its Georgia leased footprint.

For many of the leases already canceled in Georgia, they’re typically in older and less desirable buildings, Godfrey said. Those spaces have struggled to attract tenants in recent years, leading to record-setting vacancy rates in office markets like Atlanta.

Some could be prime opportunities for redevelopment, Godfrey said.

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